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29|01|08

Ed Richards comments on text and data roaming in the EU, 29 January 2008

Comments from Ofcom Chief Executive, Ed Richards, on text and data roaming in the EU, arising from Ofcom Annual Plan stakeholder meeting on 29 January 2008.

There are a number of issues set out in the European Regulators Group (ERG) Report^(-1-) on roaming charges which are of significant concern.

The high cost of text roaming

The cost of sending a text from abroad looks high: an average charge of 21 pence per roaming text sent from Europe^(-2-) compared to an average of 5.6 pence per text sent within the UK^(-3-), but with very low associated marginal cost.

Data Roaming charges - an obstacle to business

An even more significant longer term issue is the price for data roaming. The average price charged by UK operators for using data roaming services within Europe last summer was £4.11 per Mb^(-4-).

These prices represent a significant price hurdle to the use of mobile internet while abroad. We want to see industry take the initiative on this issue or we may need to see further action at the European level since national regulators are unable to address these issues unilaterally.

My biggest concern is the effect on businesses which increasingly depends on connectivity and in particular mobile connectivity.

There have been some reductions which we expect to see reflected in the next set of ERG figures. These are very welcome – but I think we need further reductions by a wider range of providers.

Ofcom, working with other national regulators across Europe, is highlighting the potential importance of this issue, based on the work of ERG. We intend to take this forward by working with colleagues in the ERG and the European Commission to examine a range of questions on how text and data roaming could be regulated in the future, if the market fails to deliver lower prices.

Voice Roaming – the 20% hidden charge

We thought that the EU Regulation that we urged the Commission to initiate in 2005 had dealt with the high cost of voice roaming. But the latest ERG analysis has brought to light a further issue.

It is common practice to charge a full first minute for any national or roaming call made, regardless of length. If the call lasts longer than a minute, the remainder is charged per second or, sometimes, thirty-second interval. This means that a twenty or thirty second call could be charged as if it took 1 minute.

But this is not contrary to the European Regulation. However, it means that for roaming, this practice adds up to 20%, on average, to consumer bills.

This is a hidden charge and I am very concerned about it. That’s why Ofcom is raising it at the first Plenary meeting of European regulators since the Report was published, which takes place today.

The Commission has said they will consider the issue in their Review of the Regulation at the end of this year. I welcome that – but any action from that Review is unlikely to benefit consumers before mid 2010. So we need to consider this more promptly. As a result we will be looking to see whether we have any scope under our national powers to take action well before that – an issue that I will be discussing with my European colleagues.

Footnotes:

1.- International Roaming – ERG Benchmark data report for April – September 2007 http://www.erg.eu.int/doc/publications/erg_07_85_intl_roaming_rep.pdf

2.- slightly below the European average of 29c per text

3.- Ofcom, The Communications Market 2007 http://www.ofcom.org.uk/research/cm/cmr07/telecoms/telecoms.pdf

4.- Huge variation across Europe, UK rate slightly above the European average €5.24 per Mb

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